Sir John Bourn, head of the National Audit Office, today reported to Parliament the results of his examination of the Child Support Agency’s Client Funds Account for 1999-2000. Sir John qualified his opinion on the account due to the level of error in receipts from non resident parents and errors in outstanding maintenance balances, arising mainly from errors in the underlying maintenance assessments.
In his report, Sir John notes that there has been no discernible improvement in the overall performance of the Agency during 1999-2000 and that significant numbers of errors were still being made. In addition, the Agency’s past performance has left a legacy of error that continues to affect amounts being paid, in respect of child maintenance, and the maintenance balances due. Sir John also notes the high number of payments made out of Exchequer Funds in compensation to customers as a result of errors and delays by the Agency. However, while the Agency need to be mindful of protecting public funds, Sir John stresses that individuals who have suffered genuine hardship at the hands of the Agency should be adequately compensated.
Proposed legislation currently before Parliament sets out plans for the reform of the Child Support Agency. The main proposal of these reforms is a simplified assessment formula based upon a percentage of net income dependent upon the number of children to be maintained. The new scheme is to be introduced for new cases from April 2002. In his report, Sir John welcomes the active steps taken by the Agency to ensure that workable systems are in place ahead of these reforms. However, he also stressed the need to ensure that sufficient resources are available to allow existing cases to be accurately transferred onto the new system.
Based on the results obtained Sir John estimates that:
- of the £473.6 million receipts from non resident parents, there were overpayments amounting to £8 million and underpayments amounting to £51 million;
- balances on full maintenance assessments at 31 March 2000, totalling £521.4 million contained overstatement errors amounting to £45 million and understatement errors amounting to £102 million; and
- balances on interim maintenance assessments at 31 March 2000, totalling £132.3 million contained overstatement errors amounting to £39 million and understatement errors amounting to £7 million.
"I continue to be concerned at the high level of error in maintenance assessments. As a consequence, the Exchequer is paying out substantial sums to compensate individuals who have suffered undue hardship and suffering. The Agency need to ensure that these problems are not simply transferred on to the new system due for implementation in April 2002."Sir John
- HC: HC658